Experts from across New York’s energy industry on Wednesday discussed how to best deal with global climate change, foster new technologies and ensure that the state leads the nation in clean energy while maintaining economic competitiveness.

“My priority is how do we evolve our industry, maintain reliability, and reach the goals of the Climate Leadership and Community Protection Act [CLCPA] of 2019 through competitive markets and private investment, which are really the linchpin to helping consumers prosper in New York state,” Independent Power Producers of New York CEO Gavin Donohue said at IPPNY’s 36th Annual Fall Conference.

Donohue said IPPNY last month partnered with the AFL-CIO and the New York State Building and Construction Trades Council to submit a petition to the Public Service Commission requesting the development of a market for zero-emission technologies that will help meet the state’s goal of net-zero electricity by 2040.

The petition urged the PSC to establish a competitive program to secure investment in 1 GW of zero greenhouse gas emission resources by 2030, and to include prevailing wage clauses in project labor agreements (15-E-0302). (See NY Generators Seek State Incentives for New Clean Energy Resources.)

Today the dispatchable fuel in New York is natural gas, while in 2030 or 2035 it could be renewable natural gas, or hydrogen fuel cells, “not to mention the potential for carbon capture and sequestration,” Donohue said. “It could be a technology none of us have even thought of yet.”

New Leadership, Goals

New York has a new governor in Kathy Hochul, the first woman to serve as the state’s chief executive, and she has established new clean energy goals since taking office Aug. 24, said New York State Energy Research and Development Authority CEO Doreen Harris.

“The announcement to sign legislation requiring the transition to 100% sales of zero-emission passenger vehicles by 2035, that’s cementing our role as a leader in this space,” Harris said. “She’s been present when we’ve held events [and] it is clear to me and to others that she’s there to support not only the industry and the process, but also the outcomes as being hugely beneficial across New York.”

Harris said she’d been pleased to see the IPPNY petition filed with the PSC and looks forward to learning more about the topic, receiving comments, and ultimately developing an approach to realizing the technologies needed in support of the 2040 emissions-free power target.

The CLCPA also calls for the procurement of 6 GW of solar by 2025, 3 GW of storage by 2030, and 9 GW of offshore wind by 2035, and all targets are on track, she said.

Asked about responsible siting of large-scale renewable energy resources, Harris said that “from the perspective of host communities directly, we have an entire clean energy siting team, and their sole job is to bring information and resources to bear on those same host communities, because ultimately we need information to be flowing in both directions to get these projects right. And they do need to be permitted to begin paying on our contracts, so ultimately we need the projects to advance in a manner that can be successful in that process.”

Goodbye Gas?

NYISO has repeatedly emphasized the need for dispatchable generation to firm up variable resources in a way that ensures the grid remains stable 24/7, 365 days a year, Donohue said.

Achieving the CLCPA goals will require transitioning the existing natural gas infrastructure to providing lower carbon fuels in the future, said Donna DeCarolis, president of the National Fuel Gas Distribution Corporation.

“In New York state we have 49,000 miles of underground natural gas delivery systems — 10,000 miles in western New York, and it’s really storm-resistant in the coldest weather,” DeCarolis said.

She cited the 2006 “October surprise” ice storm in western New York, and a 7-foot snowfall in November 2014, during which “natural gas was being delivered to homes without interruption, so that’s just an important resource that we want to consider, and it also provides a great deal of storage as well.”

The New York Climate Action Council’s Power Generation Advisory Panel in May decided to recommend that the full council adopt a moratorium on building new gas-fired power plants and related infrastructure — with the caveat that it did not achieve consensus on the idea. (See NY Power Panel to Recommend Gas Infrastructure Moratorium.)

Many studies say that in 2040 New York will need between 17,000 and 25,000 MW of rapid-start, dispatchable units that can run for a long time, said John Reese, senior vice president at Eastern Generation.

“Currently, for those to be non-fossil fuels we require magic,” Reese said.

The studies assume there are renewable natural gas units of some type that supply that need, but those are proxies, he said. Other potential solutions such as green hydrogen or long-term batteries could materialize, but “technology development is not easy and infrastructure in New York is not easy and we have very little time. I believe we need a moonshot-like level effort to ensure that we have the kinds of technologies we need to keep the lights on.”

It’s “a heavy moment” and in many ways the urgency of climate change and the impacts that New York is already experiencing grow larger every day, and the hardest impacts hit disadvantaged communities of color, said Kit Kennedy, senior director of the Climate & Clean Energy Program at the Natural Resources Defense Council.

“The work that New York state and the Climate Action Council are engaged in is more important than ever, literally a matter of life and death for increasing numbers of people,” Kennedy said. “But there’s still room for optimism and hope. The CLCPA is such a historic, transformative piece of legislation, and it gives me hope that New York is going to be a great leader on climate as it has been for a long time.”

From the perspective of large energy consumers, it appears that all the major decarbonization efforts are being funded by electric and gas customers through their energy bills as opposed to being covered from all sectors of the economy, said Couch White partner Michael Mager, who represents Multiple Intervenors, a coalition of large electricity users in the state.

“Our concern is that, from an economic development perspective, continuously increasing the cost of energy in the state is the wrong way to go,” Mager said. “We understand that sometimes it’s the politically expedient way … but we think that continuously expecting that energy consumers will fund the entire order or a predominant share of the cost of the CLCPA” is not fair.

Release of the Council’s draft scoping plan “will change everything,” Mager said. “We hope to see an estimate of CLCPA costs as well as of benefits.”

Carbon Pricing 

Carbon pricing in the electricity sector “is a very elegant answer to a problem, and it allows regulatory bodies to ratchet down the available carbon tons that are out there as the price increases,” Reese said. A carbon price sends a very clear economic signal, “so I remain a very strong advocate of that as being the most cost-effective and transparent way to get there; however, I despair that it actually can happen given today’s panorama.”

Anything that puts a price on carbon emitters is an important tool in the toolbox but not at all a panacea, Kennedy said. “I would never trade carbon pricing for the CLCPA. At some point, in some form it could be an add-on, but not a standalone, silver-bullet solution.”

Regarding the carbon pricing proposal advanced by NYISO, Mager said some of his concerns are related to the impacts on the New York economy, if the state is the only one to do it. (See FERC OKs Carbon Pricing Policy Statement.)

“We also questioned whether it made sense to only apply it to the electric energy sector and to not have it be applied on a more general statewide basis,” Mager said.

It’s best to keep policies technology-neutral and technology-inclusive whenever and wherever possible, said Dr. Melissa Lott, director of research at the Columbia Center on Global Energy Policy.

“We can often fall into this trap of picking a single winner, and at the end of the day that really undermines our progress over all, if the goal is to get to zero emissions or 90% or anywhere really ambitious,” Lott said.

Policy makers and industry leaders have also debated whether it is better to adopt a carbon tax or a clean energy standard, which Lott called a false choice.

A modest carbon price can still produce a signal in conjunction with standards and it “can actually make a clean energy standard much more efficient to have that price working in the background,” Lott said. “Whether it’s 70% by 2030 or 100% by 2035 or 100% by 2050, if it’s the CLCPA or a federal standard, you know these studies about how we can actually make policies as efficient as possible are really important.”